Monthly Archives: August 2009

Over the fold, my pre­sen­ta­tion, this week, to the 2009 Ful­bright Sem­i­nar in Can­ber­ra reflect­ing on the first 5 years expe­ri­ence of the lib­er­al­iza­tion of agri­cul­ture in the Aus­tralia-USA FTA.

The first few slides are charts of cur­rent data show­ing a sur­pris­ing­ly poor per­for­mance of Aus­tralian exports to the USA in the first five years of the imple­men­ta­tion peri­od of the free-trade area. The sec­ond half of the pre­sen­ta­tion com­pares my pre­dic­tions and expec­ta­tions for the agree­ment in 2002 (before the nego­ti­a­tions commenced—a copy of the ear­li­er paper is here) with sub­se­quent expe­ri­ence.

There are a dozen or so rur­al Vic­to­ri­an weath­er sta­tions, of the 255 list­ed as report­ing max­i­mum tem­per­a­ture data to the Aus­tralian Bureau of Mete­o­rol­o­gy, that have records stretch­ing back to years before 1900. I have found them by skim­ming through the list­ings on this page at the BOM web­site. It has a help­ful graph­ic that dynam­i­cal­ly dis­plays the record length.

I thought it might be inter­est­ing to see the trend of max­i­mum tem­per­a­tures in these rur­al loca­tions. The graph­ic (click the thumb­nail) shows that in eight of these twelve sites, includ­ing one NSW site—Deniliquin, almost on the Vic­to­ri­an border—the tem­per­a­ture trend is neg­a­tive or flat. The trend esti­mate is a sim­ple, lin­ear least-squares trend over the longest peri­od avail­able in each record with 1-sig­ma bands as indi­cat­ed. The idea for this exper­i­ment came from a post at the Car­bon-Sense Coali­tion web­site.

It’s not sur­pris­ing to see rhetor­i­cal storm-clouds build­ing over this week’s Pacif­ic Forum meet­ing in Cairns and the prospect of a region­al eco­nom­ic inte­gra­tion agree­ment (PACER Plus) in the Pacif­ic. An agree­ment that entails pro­gres­sive eco­nom­ic reform and more open mar­kets in the Pacif­ic Islands is bound to threat­en entrenched inter­ests.

But this anx­i­ety and pes­simism is mis­placed:

“ ‘Against a back­drop of the enor­mous trade imbal­ance with Aus­tralia and New Zealand, and the lack of a strong base of pro­duc­tiv­i­ty indus­try in the Pacif­ic, it is clear that a new approach is need­ed.’ An Oxfam report showed a stan­dard FTA with Aus­tralia and New Zealand would see Ton­ga lose 19 per­cent of gov­ern­ment income, Van­u­atu 18 per­cent, Kiri­bati 15 per­cent and Samoa 12 per­cent. ” Extract from3 News (NZ)

I half-agree with that state­ment: a ‘new approach’ is need­ed. But let’s be clear what an ‘enor­mous trade imbal­ance’ means in this case. It means that these tiny economies rely on exter­nal goods and ser­vices (as well as tech­nol­o­gy and spe­cial­ized labor) to enjoy some of the ben­e­fits of 21st cen­tu­ry econ­o­my. This is not only a good thing is it in fact indis­pens­able for the peo­ple of the Pacif­ic. So let’s for­get about all of this ‘neo-colo­nial­ist’ depen­den­cy non­sense and look seri­ous­ly at their real oppor­tu­ni­ties.

The PACER Plus agree­ment offers the Islands an oppor­tu­ni­ty to put their economies onto a tra­jec­to­ry for high­er and more sus­tain­able growth. Soon­er or lat­er they’ll have to go there, but their choic­es will be few­er, and tougher, the longer they delay.

Peter Gallagher

Peter Gallagher is student of piano and photography. He was formerly a senior trade official of the Australian government. For some years after leaving government, he consulted to international organizations, governments and business groups on trade and public policy.

He teaches graduate classes at the University of Adelaide on trade research methods and the role of firms in trade and growth and tweets trade (and other) stuff from @pwgallagher